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The recording industry is dying, and you killed it

Kevin Noonan | Tuesday, September 11, 2012

Our generation is so entitled, always thinking things should be handed to us. Back in the good old days, people were more than willing to buy the whole album, on vinyl or cassette, and pay the price they were told to pay, no questions asked.

They got their music, the record executives got to buy bad suits that cost more than a third world country’s GDP and Keith Richards got wacked out of his mind.

And then came the Internet, and the whole world of people getting ridiculously rich off the pocket change and table waiting tips of teenagers and college students changed forever.

First came Napster. Sean Parker and John and Shawn Fanning set up a service allowing users to share individual songs via the Internet. The recording industry eventually raised enough of a legal stink to get them shut down after two years, but the damage was done.

The U.S. recording industry’s peak was in 1999, the same year Napster was created, according to data from the Recording Industry Association of America and Business Insider. Almost without exception, each year following has seen a marked decline in the revenue per capita for the industry.

The iPod, which hit the markets in 2001, helped the cause a little. The advent of iTunes and the digital marketplace for music led to somewhat of a slowing in the revenue decline.

But even as digital sales have continued to grow, slightly, the overall revenues for the recording industry have continued to fall ¾ from $71 per capita in 1999 to only $26 in 2009.

The recording industry has responded as reasonably and rationally as anyone would expect a large oligopoly of the sort to: sue anybody and everybody.

You started a music sharing service that they don’t like? Lawsuit, deal with it. You illegally downloaded 14 copies of “Talk Dirty to Me” by Poison? They don’t care if you’re eight years old or 80 ¾ you’re going to court.

You know that Spotify music thing that pops up on your Facebook newsfeed every time some girl you friended the first week of freshmen year listens to a playlist entitled “Feeling My Feelings,” featuring songs from both Taylor Swift and Adele?

There are rumors that Apple tried to block the service from coming to the United States, likely fearing that people might, gasp, listen to music for free.

Maybe the old fogies are right. Maybe our generation is entitled and we are obsessed with over-gratification. Maybe we don’t feel like paying $24.99 for a Rolling Stones album from 40 years ago when we can download the songs for free from some shady website.

Well cool, whatever. They can say it all they want, but until they start selling to us based on that model, they’re not going to get anywhere.

No matter how much they whine about it in the press or how many $675,000 lawsuits they win against 28-year-old grad students for illegally downloading 30 songs ($22,500 a song, I used an internet calculator for free to get that number but please don’t sue me, Texas Instruments), as long as the recording industry tries to stay in the glory days of complete stranglehold on the distribution of music, they will continue to die.

And frankly, if they’re stupid enough not to adapt to the changing market, I hope they do die.

Here’s how they see it. As it stands now, most people who download their music illegally know it’s illegal; they just don’t care. It’s akin to speeding ¾ they might get caught, but they’d rather risk getting caught than pay full price. The risk-benefit for these people leads them to download their music illegally.

The music industry, in order to stabilize the crazy train to irrelevance that they’re currently on board, is hoping to increase the risk factor enough that consumers will be too afraid to download illegally, and will be forced to limp back and pay whatever price the record executives see fit.

What they’re not doing is looking at it from the other side of the equation.

What’s crazy about their refusal to reevaluate their distribution methods is that they’ve been handed a model that could eventually determine their success or failure.

Rob Delaney recently followed fellow comedians Louis C.K., Jim Gaffigan and Aziz Ansari in releasing his latest comedy special on his website for $5 (Editor’s note: You can read Patrick McManus’ review of the album in this section today.)

Louis C.K. was a pioneer of this idea. He said his special cost him roughly $250,000 to make and earned over $1 million. That means that before taxes, and before his income from tours, his television show and whatever else he does, he clears $750,000.

That’s not bad, right? I could live with $750,000 a year. With $750,000 I could, I don’t know, invest in a start up company that distributes albums for artists at $5 a pop and cuts out the record company altogether.

I have no musical talent, but looking at musical artists and groups like Chiddy Bang, Sammy Adams and Mike Posner, who all started their musical careers making high-quality music out of their college dorm rooms, it seems to me that the need to rely on the recording industry for their technology is going by the wayside.

If I can be bold, we are not far from the days when bands follow the model of comedians like Delaney and find a way to release their music directly to their consumers for a just price on which both sides of the equation can agree, hopefully leading to a decline in illegal downloading.

From where I stand, no matter who they sue or who they blame or which generation is the most entitled and selfish, the recording industry isn’t a part of that equation, and I’m all for it.